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Public Spending on Health Care in Africa: Do the Poor Benefit?

F Castro-Leal, J Dayton, L Demery and K Mehra  (2000)
9 pages (242KB)

A major aim of publicly-subsidised health care is to combat poverty. But are the poorest in Africa actually benefiting from public spending on health? This article from the Bulletin of the World Health Organisation examines spending in seven African countries and finds that it favours those who are better off – a situation that cannot be rectified simply by re-allocating subsidies.

For the first time, an analysis method known as benefit incidence is applied to African countries to show how the benefits of public spending on health care are distributed across the population. The cost of providing health services is combined with information on their use, exposing the difference in the benefit derived by the richest and the poorest from various health facilities. Most curative health subsidies are not well targeted at the poorest. Policies to improve targeting should re-direct public subsidies towards the rural clinics and dispensaries used by the poor. But they must also address the constraints that prevent the poor from accessing health services.

Estimating the benefit incidence of public spending on curative health care in seven countries with similar systems showed that the poorest 20 per cent received less than a fifth of the subsidy. The share received by the richest quintile was far larger. Other key findings are that:

  • Subsidies to the poor account for a higher share of total household expenditure than for the rich.
  • Poor households are less inclined to report illness than richer households, more likely to try self-treatment and less likely to seek public or private modern care.
  • Except for South Africans, the richest groups generally rely on publicly-provided care. This limits spending on services for the poor.
  • Governments allocate significant shares of their budgets to hospital-based services, which the poor tend not to use.
  • Poor households are often situated far from health facilities and so face long journeys and high costs to obtain health care. This, plus the cost of consultations, is a far bigger burden on them than on the rich.
  • Rich females tend to use public health services more than rich men, but poor women use them equally or sometimes less than poor men.

Benefit incidence highlights the problems of delivering health services to poor communities, but does not provide many answers. It is clear, however, that policies should be based on an understanding of the factors governing household decisions on health care. To improve targeting in Africa, the study suggests that:

  • In the long run, encouraging private providers for the rich would allow governments to direct more funding towards services used by the poor.
  • In the short to medium-term, subsidies should be re-allocated, so that less is spent on hospitals and more on facilities used by the poor.
  • Measures must be taken to increase the use of health services by the poor, particularly women. These should aim to improve access to services and their quality, as well as raising health awareness.
  • A well-designed user fee policy could help target resources to the poor. However, fees should not be applied to services used mainly by the poor, or where good-quality private care is unavailable.

Source: Castro-Leal, F., Dayton, J., Demery, L., and Mehra K., 2000, “Public Spending on Health Care in Africa: Do the Poor Benefit?”, Bulletin of the World Health Organization, vol.78, no.1, pp. 66-74.

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